Bitcoin, Ethereum Fall in Markets as South Korea Bans Cryptocurrencies

South Korea will ban all cryptocurrency trading in the country, sending virtual currencies plummeting in crypto markets.

Justice Minister Park Sang-Ki made the announcement on Thursday, calling the currencies including bitcoin and ethereum a “concern”.

“There are great concerns regarding virtual currencies and justice ministry is basically preparing a bill to ban cryptocurrency trading through exchanges,” Justice Minister Park Sang-Ki said in a statement.

Mr Park said he could not disclose specific details about the ban, but various government agencies would work together to introduce several measures.

The announcement is a major blow for cryptocurrency with South Korea one of the biggest markets for major coins including bitcoin and ethereum.

It resulted in a fall in crypto markets, with bitcoin falling 14 per cent to $US12,845, ethereum dropping 10 per cent to $US1190, while ripple fell more than 17 per cent to $US1.66.

More than 10 per cent of ethereum is traded against the South Korean won, while five percent of all bitcoin are traded against the won.

South Korean authorities reportedly began inspections last week at six banks that provide accounts to companies involved in cryptocurrency trading.

They cited concerns about potential money laundering.

Meanwhile, Chinese authorities are planning a shutdown on bitcoin miners to lead them to an “orderly exit” from the country.

“The regulatory noise in South Korea and China, that’s going to be an ongoing threat to bitcoin and to crypto more generally for the foreseeable future,” ABC Bullion chief economist Jordan Eliseo said.

“Governments, financial institutions, you name it, are still working out how best to deal with crypto and the business involved with it.”